Sundrops Energia is buying DEK and Mavericks Green Energy entirely in shares priced at ₹351, a premium to its ₹265 unlisted price, with conversion tied to its IPO filing. A read on what it means as the KP Group battery-storage bet heads for a listing.
Sundrops Energia has spent the last two years turning itself from a small solar contractor into the KP Group's battery storage arm, and its latest move is the clearest sign yet that a listing is close.
The deal is simple to state. Sundrops is acquiring up to a hundred percent of a company called DEK and Mavericks Green Energy, and paying for all of it without touching its cash. Instead of a cheque, it is issuing its own compulsorily convertible preference shares to the sellers, each of which converts into an ordinary equity share on a one for one basis. The sellers of DEK are, in effect, becoming Sundrops shareholders. The whole consideration works out to about ₹55.80 crore, settled entirely in this paper.
A ₹55 crore bolt-on would not merit a second glance on its own. What makes it worth reading is the price, and the timing.
A price set above the market
Sundrops has valued its own shares at ₹351.02 for this deal. Since the preference shares convert one for one, that is effectively the price the company has put on its equity. The unlisted market has been paying closer to ₹265, so the deal is struck at a premium of roughly a third, and above the ₹230 or so a share that the last real capital came in at in late 2024.
That premium says less about any valuation report and more about where the people running Sundrops want the equity marked before a public issue. A number like this is easy to arrive at when the promoter sits on both sides of the deal. The harder number is the one the market gives you, and that is what the IPO will test. Pricing high also holds down dilution, since fewer shares are handed over to settle the same ₹55.80 crore.
The conversion clock points at the IPO
The revealing detail is the timing built into the paper. These preference shares convert into equity within twelve months, or the moment Sundrops files its draft prospectus with SEBI, whichever comes first. Companies do not attach a clause like that unless the prospectus is close enough to plan around.
Seen this way, the acquisition looks less like an expansion and more like housekeeping. Sundrops is pulling a related green energy business fully onto its books and tidying its cap table in the final stretch before it faces the market. The promoter, Dr Faruk Patel, sits on both sides of the deal, as the man behind Sundrops and as a shareholder of the business being absorbed, so it consolidates holdings he already controls rather than changing who is in charge.
What Sundrops has become
None of this would carry weight if Sundrops were still just a solar contractor, but it has moved well past that. Over the past year it has become the KP Group's dedicated battery storage vehicle, with signed, government-backed contracts from Gujarat Urja Vikas Nigam for a cumulative 565 MW / 1,130 MWh of standalone storage. These run on a build, own and operate basis, so the assets sit on Sundrops' own books and generate annuity-style revenue for years. The build-out will cost a few thousand crore, funded through a roughly even mix of debt and equity, and that equity is what the IPO is meant to raise.
Put together, the deal is easy to read. Sundrops has used its own paper to absorb a related business, marked that paper above where the stock trades, and tied the whole exercise to the filing of its IPO papers. Once the prospectus is filed, the shares convert, the business sits fully inside Sundrops, and the share count settles. The ₹351.02 the company has put on itself becomes the last private price before the market sets a public one.